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Wednesday, June 6, 2012

CAR HIRE - the sting could be in the fuel

The investigator who ran out of fuel

Dear Car Hirers,

David Shapiro,
stockbroker and Sasfin Bank fund manager, has thrown a spanner into
the South African car hire business in the column he
writes for The Times.

It was headed Profits fueled by clever charges. PayingR20 a litre to fill a hired car’s tank is just too dear.This amount was about double what was being charged at the pumps

But by being too timid to mention the
offending company he has tarred the
entire industry with the same brush.

Even my efforts to get him to disclose the name came to naught.

He told readers that when he got a car from a well-knownhire firmat
Cape Town airport
he drove to the R3 700 odd per night Mount Nelson hotel
(no skimping on costs by his bank) and caught an early flight back to Johannesburg
the next day.

The car hire rate was R308, plus a R55 documentation fee; a R22 surcharge for picking
up the car at the airport and R82 for the petrol – Total R466.

He complained
that the extras came to more than 50% of the
main hire cost and he described these as clever marketingploys to
lift operating margins without the full knowledge and understanding of the customer.

I
hardly believe preparing an invoice is an expense a client should carry,he wrote. Why fine me for collecting thecar at the airport? It’s an indefensible ruse, but nothing compared with the R82 I was levied to refill the
tank.

He explained that his journey to and from the hotel was no more than 40 km.

I have no problem paying for fuel I consumed as long as it
is fairly measured, but applying a disproportionate cost is iniquitous.

He then followed his half hearted expose`
with this pathetic statement that showed his yellow streak.I
have no beefwith the nameless firm(then why did hemention it at all)–they have a bigger bank balance and stronger legal reach
than I.

In an effort to make sense of David's allegations the
DearjonConsumer Watchdog swung into action.

I contacted the heads of some
of the bigger names in the business and asked, When somebody
returns a car with apartially full tank, which
is then filled by your company; do
they get a receipt showing the amount of litres, the price per litre and the
total price similar to the receipt you get from
a filling station?

The answers I got from
Hertz, Avis, Budget, Tempest and Europcar showed that in some
cases the refill amount is arrived at by a complicatedestimationsystem and generally customers
don’t automatically get a detailed
invoice of the fuel used.

Most of them emphasised that they only charge the government
regulated price.

Joel Stransky, better
known for kicking that drop goal that won South Africa
the rugby World Cup against New Zealand in 1995,
than heading a car hire company told
me that at Hertz it depends on a number of
factors whetherthe customer ischarged according to system estimation or
actual fuel pumped.These include the location of the fuel depots
and whether the client wants the final invoice straight away. He added that the
customer can always ask for a
detailed break down of the fuel supplied.

At Avis Keith Rankin told me
their system of calculating fuel used was similar to Hertz
and that the litres charged for were always reflected on the customer’s invoice.

If you get a car from
Budgetthevalue on the rentalagreement
is areceipt,Ray Booth told me. If the customer
wants more information he is expected to get it himself by asking the Branch
forthe number
of litres that it took to fill or as he put it, You can divided the value by the fuel
reflected onthe invoice by the cost per litre
to find the number of litres.He
didn’t mention what method his firm uses to arrive at the cost of filling up
vehicles.

Leslie Matthews at Tempest said his firm doesn’t automatically give clients a record of the refill. If
they want it they can ask for it and there is always an audit trail.

I
was confused by some of the things Dawn Nathan-Jones of Europcar
told me on the phone. She said they don’t estimate refuelling charges, but
charge the actual amount, and if customers
want a breakdown they have to ask for it.

She added that they lose a lot on the refill side of the
business, but I can’t understand why if hirers are billed for what is used.

Calls to the reservations sections of
the firms I have mentioned
revealed that the following extras were charged at Cape Town airport: Tempest and Budget have no collection
fee, but they have a R55 documentation fee; Avis charges a R14 collection fee and R37 for documents while at Hertz
the corresponding fees are 1% of the basic hire
charge and R50.

Europcar’s Dawn
told me the collection charge was 9% of the basic
charge, which is pretty steep. But then at her reservation section I was told
there was no charge for this, but there was a R55 documentation fee.

So I was no nearer finding out which firmDavid had used.

Mathews’ view was that he should have
named andshamedthe company he was complaining
about.

I couldn’t agree more. And I think David's
sortie into investigative journalism was as bad as the service he was moaning
about. Rip off artists, who are allowed to remain anonymous in reports have no
place in a newspaper.

In an email he told me he had learnt that the tanks are notfull when
you get the car as they are driven from
the filling station and sometimes they
haven’t refilled them from thelast customer.
All this is on the customer’s
account.

Unfortunately our car hire sleuth didn’t
give me any hard evidence to back his allegations, but he claimed to have had a
lot of positive response.

Well he won’t get that from
me until he names the company he was
bitching about and provides something
substantial to back his generalisations.

But car hire firms would do themselves a favour by automatically providing every customer with a detailed statement to show how much the
refill was. This is especially so when they charge an unpalatable documentation
fee.

And it would be better still if the hire rates included
every extra (not the refill amount) so customers
know immediately what the daily rate is.

Regards,

Jon, the Consumer Watchdog,
who believes that without names no report has any validity.Comments after this was posted.David: Cool article. Well done even if I am a yellow prickKeith: Thanks!! I hope you are an Avis customer.

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About Me

I was born in South Africa just before the Boer War whenever that was?
Started life with a golden spoon in my mouth which made eating rather difficult as a result I was under nourished as a child.
Went to a posh school where I only got moved up a class when my old man donated another sight screen for the cricket pitch.
Career prospects were dismal and I was once turned down for a job in the London sewers. "Too highly qualified;"that’s what they said.
I became a journalist when the Police Force wouldn’t have me.
Like most journos I know nothing about everything but I still write about it.
I decided to have my own blog so I wouldn't have to drink with the editor for hours on end to get my stuff published when according to my independent assessment it’s always of great news value.
My religious beliefs are: You only die once so remember, "You can’t be serious and Have Fun."
NEWS FLASH: I've just been appointed the Poor Man's Press Ombudsman by Presidential Decree (Not to be confused with the PRESS COUNCIL OF SOUTH AFRICA'S, SA Press Ombudsman)